Hillman v Mayne Pharma Group - [2024] VSC 786

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMERCIAL COURT
GROUP PROCEEDINGS LIST

S ECI 2020 03351

BENJUMIN HILLMAN	Plaintiff
v
MAYNE PHARMA GROUP LTD (ACN 115 832 963)	Defendant

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JUDGE:	Watson J
WHERE HELD:	Melbourne
DATE OF HEARING:	8 November 2024
DATE OF JUDGMENT:	19 December 2024
CASE MAY BE CITED AS:	Hillman v Mayne Pharma Group
MEDIUM NEUTRAL CITATION:	[2024] VSC 786

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REPRESENTATIVE PROCEEDINGS – Part 4A Group Proceeding – Application for approval of settlement – Whether proposed settlement is fair and reasonable – Relevant considerations – Settlement approved – Settlement Distribution Scheme approved – Appointment of Scheme Administrator – Approval for payment of legal costs from settlement sum – Approval of costs of settlement administration – Approval of plaintiff reimbursement payment – Whether funding costs should be approved – Whether funding costs appropriately disclosed – Whether Court has power to reduce amount sought under funding equalisation order – Court has power to reduce funding costs – Funding costs approved – Supreme Court Act 1986 (Vic) Part 4A, ss 33V, 33ZF.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr W Edwards KC with Ms S Hogan	Phi Finney McDonald
For the Defendant	Mr J Kirkwood SC with Mr M Thomas	Herbert Smith Freehills

HIS HONOUR:

This is an application for the approval of a proposed settlement in a class action. The proposed settlement should be approved and orders made with respect to distribution of the money to be paid under the settlement.

The key questions

My consideration of the proposed settlement requires an answer to two interrelated questions:

(a) Should the Court approve the proposed settlement under s 33V(1) of the Supreme Court Act 1986 (Vic) (‘the Act’)?; and

(b) What orders should be made in respect of the distribution of the settlement sum?

To answer those two questions, the matters I need to consider are:

(a) Whether the amount each group member will receive under the proposed settlement is fair and reasonable having regard to:

(i) A reasonable estimate of the value of their claims;

(ii) The risks in the proceeding; and

(iii) The benefits of certainty and payment earlier than proceeding to judgment;

(b) Whether the releases provided by the group members are appropriate;

(c) Whether the proposed Settlement Distribution Scheme is fair and reasonable;

(d) Whether Cameron Myers from PFM should be appointed Administrator of the Settlement Distribution Scheme;

(e) Whether proposed deductions from the settlement sum for a payment to the plaintiff, legal costs, funding costs and settlement administration costs are appropriate;

(f) Whether a number of group members who failed to register in accordance with Court orders and who now seek to be included as registered group members (‘late registrants’) should be permitted to participate in the settlement; and

(g) Appropriate orders to give effect to these reasons.

The evidence before me comprises:

(a) Two affidavits of Cameron Peter Myers dated 1 November 2024 and 26 November 2024, filed on behalf of the plaintiff;

(b) A report from Kerrie-Ann…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2024] VSC 786
Decision Date: 19 December 2024

CaseChat Overview and Summary

In the case of Hillman v Mayne Pharma Group, the applicants sought approval of a settlement and distribution scheme in relation to a class action. The action was brought by individuals who had been prescribed a drug manufactured by Mayne Pharma Group, alleging that the drug had caused them harm. The applicants sought approval of the settlement under Part 4A of the Supreme Court Act 1986 (Vic), and the court was required to consider whether the proposed settlement was fair and reasonable, taking into account relevant considerations such as the merits of the case, the costs of litigation, and the benefits to the class members. The applicants also sought approval of a distribution scheme and the appointment of a scheme administrator, as well as approval of legal costs and settlement administration costs.

The court found that the proposed settlement was fair and reasonable, and approved it along with the distribution scheme and appointment of a scheme administrator. The court also approved the applicants' costs of litigation and settlement administration, as well as a payment to the plaintiffs to reimburse them for costs incurred in bringing the action. The court found that the funding costs were appropriately disclosed and approved them, but noted that it had the power to reduce the amount sought under a funding equalisation order if it considered it appropriate to do so. The court approved the funding costs as disclosed, but noted that it could reduce the amount if it considered it necessary.

The final orders of the court included approval of the settlement and distribution scheme, appointment of a scheme administrator, reimbursement of plaintiff costs, and approval of legal and settlement administration costs. The court also approved the funding costs, but noted that it could reduce the amount if it considered it necessary. The court's decision provides guidance on the considerations that must be taken into account when approving a settlement and distribution scheme in a class action, and the powers of the court in relation to funding costs.

Orders